How Domino’s Loyalty Program is Paying Off

The fact that Domino’s shares were down by more than 5 percent on the news of its third quarter earnings may only be due to the brand setting a continual standard for its strong sales performance.

Domino’s has experienced 26 quarters of positive same-store sales growth, and while the company still experienced domestic growth of 8.4 percent in the third quarter of this year, it came in below the 13 percent increase during the same quarter last year.

Domino’s CEO Patrick Doyle said Thursday during a conference call that its loyalty program has continued to be a significant driver of the brand’s sales growth through increased frequency of existing customers. The pizza chain introduced its Piece of the Pie rewards program in 2015 as a points-based system, and has since expanded it as a way for customers to win free shares of Domino’s stock through a rewards contest and to now include ordering through all platforms.

Customers using the Piece of the Pie can now redeem points through not only digital ordering, but through phone and in-store purchases. The loyalty program includes millions of customers and Doyle said the brand will continue to expand and market it. In the fourth quarter of this year, Domino’s has planned a TV advertising campaign for Piece of the Pie.

Pizza Hut, which has experienced sales decline in recent quarters, launched its first-ever Hut Rewards program in early August, and in addition to its own rewards program Papa John’s recently unveiled Facebook instant ordering. Domino’s says that voice ordering through Amazon Alexa is also becoming a popular ordering method.

“We have pretty extraordinary data on how to model our business ... what is driving our business and each component that is feeding into that,” Doyle said in a conference call Thursday. “But we are not going to share that because we don’t to help our competition.”